Former New York regulator said The closure of Signature Bank was not due to cryptocurrency

Former New York State Department of Financial Services superintendent Maria Vullo said the bank did not offer credible and consistent statistics.

According to Maria Vullo, a former New York State Department of Financial Services superintendent, New York State authorities did not close Signature Bank (SBNY) due to the firm’s crypto clients.

On Friday, Vullo told CoinDesk TV’s “First Mover” that the decision was “based on whatever the data was on the withdrawals by users.”

Sunday, the New York-based Signature Bank ceased operations in response to a move by state authorities that looked to be a cautious effort to avoid further contagion in the wake of the failure of Silicon Valley Bank (SVB).

According to Vullo, echoing previous remarks by the current Superintendent, Adrienne Harris, Signature Bank did not offer credible and consistent statistics, resulting in a severe crisis of confidence in the bank’s leadership.

Vullo, who served as NYDFS superintendent from 2016 to February 2019, said, “I don’t believe you liquidate a bank due to a policy reason; you do so because its risk management or financial picture is dangerous and unsound.”

She said that Signature Bank “may have also experienced the effects of continued spread concerns” after the recent liquidation of SVB.

Vullo said that the timing by regulators is crucial, nevertheless. By swiftly addressing SVB and Signature, bank authorities could “send a powerful message to the public that the system is safe and that we would take care of depositors,” as she put it.

According to Vullo, The latter was significant since it provided depositors a reason “not to withdraw money from other banks.”

Also Read: Silicon Valley Bank’s Parent Company Files For Bankruptcy